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Franchise brokers refer to themselves as “business coaches,”“advisors,”“referral sources,” or “sales consultants” help people who want to buy a franchise. They often advertise on the Internet and in business magazines that they will help you select among various franchise options.
Typically, a broker reviews the amount of money you have to invest and then directs you to opportunities that match your interests and resources.A broker also may help you complete applications and the paperwork to consummate the sale. Remember that franchise brokers often work for franchisors, and get paid only if a sale is completed. Limited Opportunities - Some franchise brokers may claim to be able to match you with “the perfect opportunity” because they represent a wide range of business sellers. That may be true or not. In some instances, franchise brokers represent only a few franchisors, and, as a result, their suggestions may be limited. Selection Standards - Some franchise brokers may claim that they will suggest only those franchises that meet certain standards. You may think this means that your financial risk is limited because the broker is weeding out the poor investments. In fact, some brokers represent any franchisor willing to pay them a commission for a sale. If you rely on a broker, be skeptical: you may be directed to a franchise that is failing or that doesn’t have a track record.
Upselling. |
